
Book ___— 



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ADDRESS OF PRESIDENT TAFT 
AT WINONA, MINN., SEPTEM- 
BER 17, 1909 * * * * * 




WASHINGTON 

GOVERNMENT PRINTING OFFICB 
1909 



X- 



ADDRESS OF PRESIDENT TAFTM 
AT WINONA, MINN., SEPTEM- 
BER 17, 1909 j» j» j» j* j» 




WASHINGTON 

GOVERNMENT PRINTING OFFICB 

1909 



Kt 

*$*> 






ADDRESS. 

My Fellow-Citizens: 

As long ago as August, 1906, in the 
congressional campaign in Maine, I ven- 
tured to announce that I was a tariff 
revisionist and thought that the time had 
come for a readjustment of the schedules. 
I pointed out that it had been ten years 
prior to that time that the Dingley bill 

had been passed ; that great changes had 

(1) 



taken place in the conditions surrounding 
the productions of the farm, the factory, 
and the mine, and that under the theory 
of protection in that time the rates im- 
posed in the Dingley bill in many in- 
stances might have become excessive; 
that is, might have been greater than the 
difference between the cost of production 
abroad and the cost of production at home 
with a sufficient allowance for a reasonable 
rate of profit to the American producer. I 
said that the party was divided on the issue, 



3 

but that in my judgment the opinion of the 

party was crystallizing and would prob- 
ably result in the near future in an effort 
to make such revision. I pointed out the 
difficulty that there always was in a revi- 
sion of the tariff, due to the threatened dis- 
turbance of industries to be affected and 
the suspension of business, in a way which 
made it unwise to have too many revi- 
sions. In the summer of 1907 my position 
on the tariff was challenged, and I then 
entered into a somewhat fuller discussion 



4 
of the matter. It was contended by 

the so-called " standpatters " that rates 
beyond the necessary measure of pro- 
tection were not objectionable, because 
behind the tariff wall competition al- 
ways reduced the prices, and thus saved 
the consumer. But I pointed out in that 
speech what seems to me as true to-day 
as it then was, that the danger of exces- 
sive rates was in the temptation they 
created to form monopolies in the pro- 
tected articles, and thus to take advantage 



5 
of the excessive rates by increasing the 

prices, and therefore, and in order to avoid 
such a danger, it was wise at regular 
intervals to examine the question of what 
the effect of the rates had been upon the in- 
dustries in this country, and whether the 
conditions with respect to the cost of pro- 
duction here had so changed as to warrant 
a reduction in the tariff, and to make a 
lower rate truly protective of the industry. 
It will be observed that the object of 
the revision under such a statement was 



6 

not to destroy protected industries in this 

country, but it was to continue to protect 
them where lower rates offered a sufficient 
protection to prevent injury by foreign 
competition. That was the object of the 
revision as advocated by me, and it was 
certainly the object of the revision as 
promised in the Republican platform. 

I want to make as clear as I can this 
proposition, because, in order to determine 
whether a bill is a compliance with the 
terms of that platform, it must be under- 



7 
stood what the platform means. A free 

trader is opposed to any protective rate 
because he thinks that our manufacturers, 
our farmers, and our miners ought to with- 
stand the competition of foreign manufac- 
turers and miners and farmers, or else go 
out of business and find something else 
more profitable to do. Now, certainly the 
promises of the platform did not contem- 
plate the downward revision of the tariff 
rates to such a point that any industry 
theretofore protected should be injured. 



8 

Hence, those who contend that the promise 

of the platform was to reduce prices by 
letting in foreign competition are contend- 
ing for a free trade, and not for anything 
that they had the right to infer from the 
Republican platform. 

The Ways and Means Committee of 
the House, with Mr. Payne at its head, 
spent a full year in an investigation, 
assembling evidence in reference to the 
rates under the tariff, and devoted an im- 
mense amount of work in the study of 



9 

the question where the tariff rates could 

be reduced and where they ought to be 
raised with a view to maintaining a rea- 
sonably protective rate, under the prin- 
ciples of the platform, for every industry 
that deserved protection. They found that 
the determination of the question, what 
was the actual cost of production and 
whether an industry in this country could 
live utfder a certain rate and withstand 
threatened competition from abroad, was 
most difficult. The manufacturers were 



IO 

prone to exaggerate the injury which a 
reduction in the duty would give and to 
magnify the amount of duty that was 
needed; while the importers, on the other 
hand, who were interested in developing 
the importation from foreign shores, were 
quite likely to be equally biased on the 
other side. 

Mr. Payne reported a bill — the Payne 
tariff bill — which went to the Senate and 
w r as amended in the Senate by increasing 
the duty on some things and decreasing it 



II 

on others. The difference between the 

House bill and the Senate bill was very 
much less than the newspapers repre- 
sented. It turns out upon examination 
that the reductions in the Senate were 
about equal to those in the House, though 
they differed in character. Now, there is 
nothing quite so difficult as the discussion 
of a tariff bill, for the reason that it covers 
so many different items, and the meaning 
of the terms and the percentages are very 
hard to understand. The passage of a 



12 

new bill, especially where a change in 
the method of assessing the duties has 
been followed, presents an opportunity for 
various modes and calculations of the 
percentages of increases and decreases 
that are most misleading and really throw 
no light at all upon the changes made. 

One way of stating what was done 
is to say what the facts show — that under 
the Dingley law there were 2,024 items. 
This included dutiable items only. The 
Payne law leaves 1,150 of these items 



13 

unchanged. There are decreases in 654 

of the items and increases in 220 of the 
items. Now, of course, that does not 
give a full picture, but it does show the 
proportion of decreases to have been three 
times those of the increases. Again, the 
schedules are divided into letters from A 
to N. The first schedule is that of chem- 
icals, oils, etc. There are 232 items in the 
Dingley law; of these, 81 were decreased, 
22 were increased, leaving 129 unchanged. 
Under Schedule B — Earths, earthen and 



14 

glass ware — there were 170 items in the 

Dingley law; 46 were decreased, 12 
were increased, and 112 left unchanged. 
C is the schedule of metals and man- 
ufactures. There were 321 items in the 
Dingley law; 185 were decreased, 30 
were increased, and 106 were left un- 
changed. D is the schedule of wood 
and manufactures of wood. There were 
35 items in the Dingley law; 18 were 
decreased, 3 were increased, and 14 were 
left unchanged. There were 38 items 



15 

in sugar, and of these 2 were decreased 

and 36 left unchanged. Schedule F 
covers tobacco and manufactures of 
tobacco, of which there were 8 items; 
they were all left unchanged. In the 
schedule covering agricultural products 
and provisions there were 187 items in 
the Dingley law; 14 of them were de- 
creased, 19 were increased, and 154 left 
unchanged. Schedule H — that of spirits 
and wines — contained 33 items in the 
Dingley law ; 4 were decreased, 23 



i6 

increased, and 6 were left unchanged. 

In cotton manufactures there were 261 
items ; of these 28 were decreased, 47 
increased, and 186 left unchanged. In 
Schedule J — flax, hemp, and jute — there 
were 254 items in the Dingley law ; 
187 were reduced, 4 were increased, and 
63 left unchanged. In wool, and manu- 
factures thereof, there were 78 items ; 3 
were decreased, none were increased, and 
75 left unchanged. In silk and silk 
goods there were 78 items; of these, 



i7 
21 were decreased, 31 were increased, 

and 26 were left unchanged. In pulp, 

papers, and books there were 59 items 

in the Dingley law, and of these 1 1 

were decreased, 9 were increased, and 39 

left unchanged. In sundries there were 

270 items, and of these 54 were decreased, 

20 were increased, and 196 left unchanged. 

So that the total showed 2,024 items in the 

Dingley law, of which 654 were decreased, 

220 were increased, making 874 changes, 

and 1,150 left unchanged. 



i8 



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Attempts have been made to show 

what the real effect of these changes has 
been by comparing the imports under the 
various schedules, and assuming that the 
changes and their importance were in 
proportion to the importations. Nothing 
could be more unjust in a protective tariff 
which also contains revenue provisions. 
Some of the tariff is made for the purpose 
of increasing the revenue by increasing 
importations which shall pay duty. Other 
items in the tariff are made for the 



20 

purpose of reducing competition, that 
is, by reducing importations, and, there- 
fore, the question of the importance of a 
change in rate can not in the slightest de- 
gree be determined by the amount of im- 
ports that take place. In order to determine 
the importance of the changes, it is much 
fairer to take the articles on which the rates 
of duty have been reduced and those on 
which the rates of duty have been increased, 
and then determine from statistics how 
large a part the articles upon which duties 



21 

have been reduced play in the consump- 
tion of the country, and how large a part 
those upon which the duties have been 
increased play in the consumption of the 
country. Such a table has been prepared 
by Mr. Payne, than whom there is no one 
who understands better what the tariff is 
and who has given more attention to the 
details of the schedule. 

Now, let us take Schedule A — chem- 
icals, oils, and paints. The articles upon 
which the duty has been decreased are 



22 

consumed in this country to the extent of 
$433,000,000. The articles upon which 
the duty has been increased are consumed 
in this country to the extent of $1 1,000,000. 
Take Schedule B. The articles on which 
the duty has been decreased entered in 
the consumption of the country to the 
amount of $128,000,000, and there has 
been no increase in duty on such arti- 
cles. Take Schedule C — metals and their 
manufactures. The amount to which 
such articles enter into the consump- 



23 

tion of the country is $1,221,000,000, 
whereas the articles of the same sched- 
ule upon which there has been an 
increase enter into the consumption of 
the country to the extent of only 
$37,000,000. Take Schedule D — lumber. 
The articles in this schedule upon which 
there has been a decrease enter into the 
consumption of the country to the extent of 
$566,000,000, whereas the articles under 
the same schedule upon which there has 
been an increase enter into its consumption 



24 

to the extent of $31,000,000. In tobacco 
there has been no change. In agricul- 
tural products, those in which there has 
been a reduction of rates enter into the 
consumption of the country to the extent 
of $483,000,000; those in which there has 
been an increase enter into the consump- 
tion to the extent of $4,000,000. In the 
schedule of wines and liquors, the arti- 
cles upon which there has been an 
increase, enter into the consumption of 
the country to the extent of $462,000,000. 



25 

In cottons there has been a change in 
the higher-priced cottons and an increase. 
There has been no increase in the lower- 
priced cottons, and of the increases the 
high-priced cottons enter into the con- 
sumption of the country to the extent 
of $41,000,000. Schedule J — flax, hemp, 
and jute : The articles upon which there 
has been a decrease enter into the con- 
sumption of the country to the extent 
of $22,000,000, while those upon which 
there has been an increase enter into the 



26 

consumption to the extent of $804,000. In 
Schedule J as to wool, there has been no 
change. In Schedule L as to silk, the duty- 
has been decreased on articles which enter 
into the consumption of the country to 
the extent of $8,000,000, and has been 
increased on articles that enter into the con- 
sumption of the country to the extent of 
$106,000,000. On paper and pulp the duty 
has been decreased on articles, including 
print paper, that enter into the consumption 
of the country to the extent of $67,000,000, 



27 
and increased on articles that enter into 

the consumption of the country to the 
extent of $81,000,000. In sundries, or 
Schedule N, the duty has been decreased 
on articles that enter into the consump- 
tion of the country to the extent of 
$1,719,000,000; and increased on articles 
that enter into the consumption of the 
country to the extent of $101,000,000. 

It will be found that in Schedule A 
the increases covered only luxuries — per- 
fumeries, pomades, and like articles; Sched- 



28 

ule H — wines and liquors — which are cer- 
tainly luxuries and are made subject to 
increase in order to increase the revenues, 
amounting to $462,000,000; and in Sched- 
ule L — silks — which are luxuries, certainly, 
$106,000,000, making a total of the con- 
sumption of those articles upon which 
there was an increase and which were 
luxuries of $579,000,000, leaving a bal- 
ance of increase on articles which were not 
luxuries of value in consumption of only 
$272,000,000, as against $5,000,000,000, 



2 9 

representing the amount of articles enter- 
ing into the consumption of the country, 
mostly necessities, upon which there has 
been a reduction of duties, and to which 
the 650 decreases applied. 



30 

Statement. 



Sched- 




Consumption value. 


Article. 










Duties decreased. 


Duties in- 
creased. 


A 


Chemicals, oils, and paints. 


$433, °99, 846 


$11, 105, 820 


B 


Earths, earthenware, and 








glassware 


128, 423, 732 




C 


Metals, and manufactures 






of 


1, 221, 956, 620 
566, 870, 950 


37, 675, 804 

31,280,372 


D 


Wood, and manufactures of . 


B 


Sugar, molasses, and manu- 








factures of 


300, 965, 953 




F 


Tobacco, and manufactures 






of (no change of rates ) . 






G 


Agricultural products and 








provisions 


483, 430, 637 


4, 380, 043 


H 


Spirits, wines, and other 








beverages 




462. 001, 8s6 


I 


Cotton manufactures 




41, 622, 024 


J 


Flax, hemp, jute, and 






manufactures of 


22, 127, 145 


804, 445 


K 


Wool and manufactures of 
wool. (No production 
statistics available for 
articles affected by- 
changes of rates. ) 






L 


Silks and silk goods 


7, 947, 568 


106, 742, 646 


M 


Pulp, papers, and books . . 


67, 628, 055 


81, 486, 466 


N 


Sundries 


1, 719, 428,069 


101, 656, 598 




Total 






4,951,878,575 


878, 756, 074 









3i 

Of the above increases the following are 

luxuries, being articles strictly of volun- 
tary use: 

Schedule A. Chemicals, including perfumeries, po- 
mades, and like articles $11, 105, 820 

Schedule H. Wines and liquors 462, 001, 856 

Schedule L. Silks 106, 742, 646 

Total 579, 850, 322 

This leaves a balance of increases which 
are not on articles of luxury of $298,- 
905,752, as against decreases on about 
five billion dollars of consumption. 

Now, this statement shows as con- 
clusively as possible the fact that there 
was a substantial downward revision on 



32 

articles entering into the general con- 
sumption of the country which can be 
termed necessities, for the proportion is 
$5,000,000,000, representing the con- 
sumption of articles to which decreases 
applied, to less than $300,000,000 of 
articles of necessity to which the increases 
applied. 

Now, the promise of the Republican 
platform was not to revise everything 
downward, and in the speeches which 
have been taken as interpreting that plat- 



33 

form, which I made in the campaign, I 

did not promise that everything should 
go downward. What I promised was, 
that there should be many decreases, and 
that in some few things increases would 
be found to be necessary; but that on the 
whole I conceived that the change of con- 
ditions would make the revision neces- 
sarily downward — and that, I contend, 
under the showing which I have made, 
has been the result of the Payne bill. I did 
not agree, nor did the Republican party 



34 
agree, that we would reduce rates to such a 

point as to reduce prices by the introduc- 
tion of foreign competition. That is what 
the free traders desire. That is what the 
revenue tariff reformers desire; but that is 
not what the Republican platform prom- 
ised, and it is not what the Republican 
party wished to bring about. To repeat 
the statement with which I opened this 
speeeh, the proposition of the Repub- 
lican party was to reduce rates so as to 
maintain a difference between the cost of 



35 

production abroad and the cost of produc- 
tion here, insuring a reasonable profit to 
the manufacturer on all articles produced 
in this country; and the proposition to re- 
duce rates and prevent their being exces- 
sive was to avoid the opportunity for mo- 
nopoly and the suppression of competition, 
so that the excessive rates could be taken 
advantage of to force prices up. 

Now, it is said that there was not a 
reduction in a number of the schedules 
where there should have been. It is said 



36 

that there was no reduction in the cotton 

schedule. There was not. The House 
and the Senate took evidence and found 
from cotton manufacturers and from other 
sources that the rates upon the lower class 
of cottons were such as to enable them to 
make a decent profit — but only a decent 
profit — and they were contented with it; but 
that the rates on the higher grades of cot- 
ton cloth, by reason of court decisions, had 
been reduced so that they were consider- 
ably below those of the cheaper grades of 



37 
cotton cloth, and that by undervaluations 

and otherwise the whole cotton schedule 
had been made unjust and the various 
items were disproportionate in respect to 
the varying cloths. Hence, in the Senate 
a new system was introduced attempting 
to make the duties more specific rather 
than ad valorem, in order to prevent by 
judicial decision or otherwise a dispropor- 
tionate and unequal operation of the sched- 
ule. Under this schedule it was contended 
that there had been a general rise of 



38 

all the duties on cotton. This was vigor- 
ously denied by the experts of the Treas- 
ury Department. At last, the Senate 
in conference consented to a reduction 
amounting to about 10 per cent on all the 
lower grades of cotton, and this reduced 
the lower grades of cotton substantially to 
the same rates as before and increased the 
higher grades to what they ought to be 
under the Dingley law and what they were 
intended to be. Now, I am not going 
into the question of evidence as to whether 



39 

the cotton duties were too high and whether 

the difference between the cost of produc- 
tion abroad and at home, allowing for a 
reasonable profit to the manufacturer here, 
is less than the duties which are imposed 
under the Payne bill. It was a question 
of evidence which Congress passed upon, 
after they heard the statements of cotton 
manufacturers and such other evidence as 
they could avail themselves of. I agree 
that the method of taking evidence and 
the determination was made in a general 



4o 
way, and that there ought to be other 

methods of obtaining evidence and reach- 
ing a conclusion more satisfactory. 

Criticism has also been made of the 
crockery schedule and the failure to reduce 
that. The question whether it ought to 
have been reduced or not was a ques- 
tion of evidence which both committees of 
Congress took up, and both concluded 
that the present rates on crockery were 
such as were needed to maintain the 
business in this country. I had been in- 



4i 
formed that the crockery schedule was 

not high enough, and mentioned that in 
one of my campaign speeches as a sched- 
ule probably where there ought to be some 
increases. It turned out that the difficulty 
was rather in undervaluations than in the 
character of the schedule itself, and so it 
was not changed. It is entirely possible to 
collect evidence to attack almost any of 
the schedules, but one story is good until 
another is told, and I have heard no 
reason for sustaining the contention that 



42 

the crockery schedule is unduly high. So 
with respect to numerous details — items 
of not great importance — in which, upon 
what they regarded as sufficient evidence, 
the committee advanced the rates in order 
to save a business which was likely to be 
destroyed. 

I have never known a subject that will 
evoke so much contradictory evidence as 
the question of tariff rates and the ques- 
tion of cost of production at home and. 
abroad. Take the subject of paper. A 



43 

committee was appointed by Congress a 

year before the tariff sittings began, to 
determine what the difference was between 
the cost of production in Canada of print 
paper and the cost of production here, and 
they reported that they thought that a 
good bill would be one imposing $2 a ton 
on paper, rather than $6, the Dingley rate, 
provided that Canada could be induced to 
take off the export duties and remove the 
other obstacles to the importation of 
spruce wood in this country out of which 



44 
wood pulp is made. An examination of 

the evidence satisfied Mr. Payne — I believe 
it satisfied some of the Republican dissent- 
ers — that $2, unless some change was 
made in the Canadian restrictions upon 
the exports of wood to this country, was 
much too low, and that $4 was only a fair 
measure of the difference between the cost 
of production here and in Canada. In 
other words, the $2 found by the special 
committee in the House was rather an 
invitation to Canada and the Canadian 



45 
print-paper people to use their influence 

with their government to remove the 
wood restrictions by reducing the duty on 
print paper against Canadian print-paper 
mills. It was rather a suggestion of a 
diplomatic nature than a positive state- 
ment of the difference in actual cost of 
production under existing conditions be- 
tween Canada and the United States. 

There are other subjects which I might 
take up. The tariff on hides was taken 
off because it was thought that it was not 



4 6 

necessary in view of the high price of 

cattle thus to protect the man who raised 
them, and that the duty imposed was 
likely to throw the control of the sale of 
hides into the hands of the meat packers 
in Chicago. In order to balance the 
reduction on hides, however, there was a 
great reduction in shoes, from 25 to 10 
per cent ; on sole leather, from 20 to 5 per 
cent; on harness, from 45 to 20 per cent. 
So there was a reduction in the duty on 
coal of 33^ per cent. All countervailing 



47 
duties were removed from oil, naphtha, 

gasoline, and its refined products. Lum- 
ber was reduced from $2 to $1.25; 
and these all on articles of prime 
necessity. It is said that there might have 
been more. But there were many business 
interests in the South, in Maine, along the 
border, and especially in the far Northwest, 
which insisted that it would give great 
advantage to Canadian lumber if the 
reduction were made more than 75 cents. 
Mr. Pinchot, the Chief Forester, thought 



4 8 

that it would tend to make better lumber 

in this country if a duty were retained on 
it. The lumber interests thought that $2 
was none too much, but the reduction was 
made and the compromise effected. Per- 
sonally I was in favor of free lumber, 
because I did not think that if the tariff 
was taken off there would be much suffer- 
ing among the lumber interests. But in 
the controversy the House and the Senate 
took a middle course, and who can say 
they were not justified. 



49 
With respect to the wool schedule: I 

agree that it is too high and that it 
ought to have been reduced, and that it 
probably represents considerably more 
than the difference between the cost of 
production abroad and the cost of pro- 
duction here. The difficulty about the 
woolen schedule is that there were two 
contending factions early in the history 
of Republican tariffs, to wit, wool grow- 
ers and the woolen manufacturers, and 
that finally, many years ago, they settled 



5o 
on a basis by which wool in the grease 

should have 1 1 cents a pound, and by 
which allowance should be made for the 
shrinkage of the washed wool in the dif- 
ferential upon woolen manufactures. 
The percentage of duty was very heavy — 
quite beyond the difference in the cost of 
production, which was not then regarded 
as a necessary or proper limitation upon 
protective duties. 

When it came to the question of reduc- 
ing the duty at this hearing in this tariff bill 



5i 
on wool, Mr. Payne, in the House, and Mr. 

Aldrich, in the Senate, although both fa- 
vored reduction in the schedule, found that 
in the Republican party the interests of the 
woolgrowers of the far West and the in- 
terests of the woolen manufacturers in the 
East and in other States, reflected through 
their representatives in Congress, was suf- 
ficiently strong to defeat any attempt to 
change the woolen tariff, and that had it 
been attempted it would have beaten 
the bill reported from either committee. 



52 

I am sorry this is so, and I could 



wish that it had been otherwise. It is 
the one important defect in the present 
Payne tariff bill, and in the performance of 
the promise of the platform to reduce 
rates to a difference in the cost of 
production, with reasonable profit to the 



manufacturer. That it will increase the 



price of woolen cloth or clothes, I very 
much doubt. There have been increases 
by the natural increase in the price of 
wool the world over as an agricultural 



53 

product, but this was not due to the 

tariff, because the tariff was not changed. 
The increase would therefore have taken 
place whether the tariff would have been 
changed or not. The cost of woolen 
cloths behind the tariff wall, through the 
effect of competition, has been greatly 
less than the duty, if added to the price, 
would have made it. 

There is a complaint now by the 
woolen clothiers and by the carded woolen 
people of this woolen schedule. They 



54 
have honored me by asking in circulars 

sent out by them that certain questions be 
put to me in respect to it, and asking why 
I did not veto the bill in view of the fact 
that the woolen schedule was not made 
in accord with the platform. I ought to 
say in respect to this point that all of them 
in previous tariff bills were strictly in favor 
of maintaining the woolen schedule as it 
was. The carded woolen people are find- 
ing that carded wools are losing their 
sales because they are going out of 



55 
style. People prefer worsteds. The 

clothing people who are doing so much 
circularizing were contented to let the 
woolen schedule remain, as it was until 
very late in the tariff discussion, long 
after the bill had passed the House, 
and, indeed, they did not grow very 
urgent until the bill had passed the Sen- 
ate. This was because they found that 
the price of woolen cloth was going up, 
and so they desired to secure reduction 
in the tariff which would enable them to 



56 
get cheaper material. They themselves 

are protected by a large duty, and I can 
not with deference to them ascribe their 
intense interest only to a deep sympathy 
with the ultimate consumers, so-called. 
But, as I have already said, I am quite will- 
ing to admit thatallowing the woolen sched- 
ule to remain where it is, is not a compliance 
with the terms of the platform as I inter- 
pret it and as it is generally understood. 
On the whole, however, I am bound 
to say that I think the Payne tariff 



57 
bill is the best tariff bill that the Re- 

publican party ever passed ; that in it the 
party has conceded the necessity for fol- 
lowing the changed conditions and re- 
ducing tariff rates accordingly. This 
is a substantial achievement in the direc- 
tion of lower tariffs and downward re- 
vision, and it ought to be accepted as 
such. Critics of the bill utterly ignore 
the very tremendous cuts that have 
been made in the iron schedule, which 
heretofore has been subject to criticism 



58 

in all tariff bills. From iron ore, which 

was cut 75 per cent, to all the other 
items as low as 20 per cent, with 
an average of something like 40 or 
50 per cent that schedule has been re- 
duced so that the danger of increasing 
prices through a monopoly of the business 
is very much lessened, and that was the 
chief purpose of revising the tariff down- 
ward under Republican protective princi- 
ples. The severe critics of the bill pass 
this reduction in the metal schedule with 



59 

a sneer, and say that the cut did not hurt 

the iron interests of the country. Well, 
of course it did not hurt them. It was 
not expected to hurt them. It was ex- 
pected only to reduce excessive rates, so 
that business should still be conducted at a 
profit, and the very character of the criti- 
cism is an indication of the general 
injustice of the attitude of those who 
make it, in assuming that it was the 
promise of the Republican party to hurt 
the industries of the country by the 



6o 

reductions which they were to make in 

the tariff, whereas it expressly indicated 
as plainly as possible in the platform that 
all of the industries were to be protected 
against injury by foreign competition, and 
the promise only went to the reduction of 
excessive rates beyond what was necessary 
to protect them. 

The high cost of living, of which 50 
per cent is consumed in food, 25 per cent 
in clothing, and 25 per cent in rent and 
fuel, has not been produced by the tariff, 



6i 
because the tariff has remained the same 

while the increases have gone on. It is 
due to the change of conditions the world 
over. Living has increased everywhere in 
cost — in countries where there is free trade 
and in countries where there is protection — 
and that increase has been chiefly seen in 
the cost of food products. In other words, 
we have had to pay more for the products 
of the farmer, for meat, for grain, for every- 
thing that enters into food. Now, cer- 
tainly no one will contend that protection 



62 

has increased the cost of food in this coun- 
try, when the fact is that we have been the 
greatest exporters of food products in the 
world. It is only that the demand has 
increased beyond the supply, that farm 
lands have not been opened as rapidly 
as the population and the demand has 
increased. I am not saying that the 
tariff does not increase prices in cloth- 
ing and in building and in other items 
that enter into the necessities of life, 
but what I wish to emphasize is that 



63 

the recent increases in the cost of liv- 
ing in this country has not been due to 
the tariff. We have a much higher stand- 
ard of living in this country than they have 
abroad, and this has been made possible 
by higher income for the workingman, the 
farmer, and all classes. Higher wages 
have been made possible by the encourage- 
ment of diversified industries, built up and 
fostered by the tariff. 

Now, the revision downward of the 
tariff that I have favored will not, I hope, 



6 4 

destroy the industries of the country. 

Certainly it is not intended to. All that 
it is intended to do, and that is what I 
wish to repeat, is to put the tariff where it 
will protect industries here from foreign 
competition, but will not enable those who 
will wish to monopolize to raise prices by 
taking advantage of excessive rates beyond 
the normal difference in the cost of pro- 
duction. 

If the country desires free trade, and 
the country desires a revenue tariff and 



65 
wishes the manufacturers all over the 

country to go out of business, and to have 
cheaper prices at the expense of the sacri- 
fice of many of our manufacturing inter- 
ests, then it ought to say so and ought to 
put the Democratic party in power if it 
thinks that party can be trusted to carry 
out any affirmative policy in favor of a 
revenue tariff. Certainly in the discus- 
sions in the Senate there was no great 
manifestation on the part of our Demo- 
cratic friends in favor of reducing rates on 



66 
necessities. They voted to maintain the 

tariff rates on everything that came from 

their particular sections. If we are to have 

free trade, certainly it can not be had 

through the maintenance of Republican 

majorities in the Senate and House and a 

Republican administration. 

And now the question arises, what was 

the duty of a Member of Congress who 

believed in a downward revision greater 

than that which has been accomplished, 

who thought that the wool schedules 



6 7 

ought to be reduced, and that perhaps 

there were other respects in which the bill 
could be improved? Was it his duty be- 
cause, in his judgment, it did not fully 
and completely comply with the promises 
of the party platform as he interpreted it, 
and indeed as I had interpreted it, to vote 
against the bill? I am here to justify 
those who answer this question in the 
negative. Mr. Tawney was a downward 
revisionist like myself. He is a low-tariff 
man, and has been known to be such in 



68 
Congress all the time he has been there. 

He is a prominent Republican, the head 
of the Appropriations Committee, and when 
a man votes as I think he ought to vote, 
and an opportunity such as this presents 
itself, I am glad to speak in behalf of 
what he did, not in defense of it, but in 
support of it. 

This is a government by a majority of 
the people. It is a representative govern- 
ment. People select some 400 members 
to constitute the lower House and some 



6 9 

92 members to constitute the upper House 

through their legislatures, and the varying 
views of a majority of the voters in eighty 
or ninety millions of people are reduced 
to one resultant force to take affirmative 
steps in carrying on a government by a 
system of parties. Without parties popu- 
lar government would be absolutely im- 
possible. In a party, those who join it, 
if they would make it effective, must sur- 
render their personal predilections on 
matters comparatively of less importance 



70 
in order to accomplish the good which 

united action on the most important prin- 
ciples at issue secures. 

Now, I am not here to criticise those 
Republican Members and Senators whose 
views on the subject of the tariff were so 
strong and intense that they believed it 
their duty to vote against their party on 
the tariff bill. It is a question for each 
man to settle for himself. The question 
is whether he shall help maintain the party 
solidarity for accomplishing its chief pur- 



7i 
poses, or whether the departure from prin- 
ciple in the bill as he regards it is so 
extreme that he must in conscience aban- 
don the party. All I have to say is, in 
respect to Mr. Tawney's action, and in 
respect to my own in signing the bill, that 
I believed that the interests of the coun- 
try, the interests of the party, required me 
to sacrifice the accomplishment of certain 
things in the revision of the tariff which I 
had hoped for, in order to maintain party 
solidarity, which I believe to be much 



7 2 

more important than the reduction of 
rates in one or two schedules of the tariff. 



Had Mr. Tawney voted against the bill, 



and there had been others of the House 
sufficient in number to have defeated the 
bill, or if I had vetoed the bill because of 
the absence of a reduction of rates in the 
wool schedule, when there was a general 
downward revision, and a substantial 
one though not a complete one, we 
should have left the party in a con- 
dition of demoralization that would 



73 
have prevented the accomplishment 

of purposes and a fulfillment of other 
promises which we had made just 
as solemnly as we had entered into that 
with respect to the tariff. When I could 
say without hesitation that this is the best 
tariff bill that the Republican party has 
ever passed, and therefore the best tariff 
bill that has been passed at all, I do not 
feel that I could have reconciled any other 
course to my conscience than that of sign- 
ing the bill, and I think Mr. Tawney feels 



74 

the same way. Of course if I had vetoed 

the bill I would have received the applause 
of many Republicans who may be called 
low-tariff Republicans, and who think 
deeply on that subject, and of all the De- 
mocracy. Our friends the Democrats 
would have applauded, and then laughed 
in their sleeve at the condition in which 
the party would have been left; but, 
more than this, and waiving considera- 
tions of party, where would the country 



75 
have been had the bill been vetoed, 

or been lost by a vote? It would have 
left the question of the revision of the 
tariff open for further discussion during 
the next session. It would have sus- 
pended the settlement of all our business 
down to a known basis upon which pros- 
perity could proceed and investments be 
made, and it would have held up the 
coming of prosperity to this country cer- 
tainly for a year and probably longer. 



7 6 
These are the reasons why Mr. Tawney 

voted for the bill. These are the reasons 
why I signed it. 

But there are additional reasons why 
the bill ought not to have been beaten. 
It contained provisions of the utmost im- 
portance in the interest of this country in 
dealing with foreign countries and in the 
supplying of a deficit which under the 
Dingley bill seemed inevitable. There 
has been a disposition in some foreign 
countries taking advantage of greater elas- 



77 
ticity in their systems of imposing tariffs 

and of making regulations to exclude our 
products and exercise against us undue 
discrimination. Against these things we 
have been helpless, because it required an 
act of Congress to meet the difficulties. 
It is now proposed, by what is called the 
maximum and minimum clause, to enable 
the President to allow to come into 
operation a maximum, or penalizing in- 
crease of duties over the normal or mini- 
mum duties whenever in his opinion the 



78 
conduct of the foreign countries has been 

unduly discriminatory against the United 
States. It is hoped that very little use 
may be required of this clause, but its 
presence in the law and the power con- 
ferred upon the Executive, it is thought, 
will prevent in the future such undue dis- 
criminations. Certainly this is most im- 
portant to our exporters of agricultural 
products and manufactures. 

Second. We have imposed an excise 
tax upon corporations measured by i per 



79 

cent upon the net income of all corpora- 
tions except fraternal and charitable cor- 
porations, after exempting $5,000. This, 
it is thought, will raise an income of 26 
to 30 millions of dollars, will supply the 
deficit which otherwise might arise with- 
out it, and will bring under federal su- 
pervision more or less all the corpora- 
tions of the country. The inquisitorial 
provisions of the act are mild but effect- 
ive, and certainly we may look not only 
for a revenue but for some most interest- 



8o 

ing statistics and the means of obtaining 

supervision over corporate methods that 
has heretofore not obtained. 

Then, we have finally done justice to 
the Philippines. We have introduced 
free trade between the Philippines and the 
United States, and we have limited the 
amount of sugar and the amount of 
tobacco and cigars that can be introduced 
from the Philippines to such a figure as 
shall greatly profit the Philippines and 
yet in no way disturb the products of 



8i 

the United States or interfere with those 

engaged in the tobacco or sugar interests 
here. These features of the bill were most 
important, and the question was whether 
they were to be sacrificed because the bill 
did not in respect to wool and woolens and 
in some few other matters meet our expec- 
tations. I do not hesitate to repeat that I 
think it would have been an unwise sacri- 
fice of the business interests of the country, 
it would have been an unwise sacrifice 
of the solidarity, efficiency, and promise- 



82 

performing power of the party, to have 
projected into the next session another 
long discussion of the tariff, and to have 
delayed or probably defeated the legisla- 
tion needed in the improvement of our 
interstate commerce regulation, and in 
making more efficient our antitrust law 
and the prosecutions under it. Such leg- 
islation is needed to clinch the Roosevelt 
policies, by which corporations and those 
in control of them shall be limited to a 
lawful path and shall be prevented from 



83 

returning to those abuses which a recur- 
rence of prosperity is too apt to bring 
about unless definite, positive steps of a 
legislative character are taken to mark 
the lines of honest and lawful corporate 
management. 

Now, there is another provision in the 
new tariff bill that I regard as of the 
utmost importance. It is a provision 
which appropriates $75,000 for the Presi- 
dent to employ persons to assist him in 
the execution of the maximum and mini- 



8 4 
mum tariff clause and in the administra- 
tion of the tariff law. Under that authority 
I conceive that the President has the right 
to appoint a board, as I have appointed 
it, who shall associate with themselves, 
and have under their control, a num- 
ber of experts who shall address them- 
selves, first, to the operation of foreign 
tariffs upon the exports of the United 
States, and then to the operation of the 
United States tariff upon imports and ex- 
ports. There are provisions in the gen- 



85 

eral tariff procedure for the ascertainment 

of the cost of production of articles abroad 
and the cost of production of articles 
here. I intend to direct the board, in 
the course of these duties and in carrying 
them out, in order to assist me in the 
administration of the law, to make what 
might be called a glossary of the tariff, or 
a small encyclopedia of the tariff, or 
something to be compared to the United 
States Pharmacopoeia with reference 
to information as to drugs and med- 



86 
icines. I conceive that such a board 

may very properly, in the course of their 
duties, take up separately all the items 
of the tariff, both those on the free list 
and those which are dutiable, describe 
what they are, where they are manufac- 
tured, what their uses are, the methods 
of manufacture, the quantity of the 
manufacture, the cost of production 
abroad and here, and every other fact 
with respect to each item which would 
enable the Executive to understand the 



87 

operation of the tariff, the value of the 

article, and the amount of duty imposed, 
and all those details which the stu- 
dent of every tariff law finds it so 
difficult to discover. I do not intend, 
unless compelled or directed by Congress, 
to publish the result of these investiga- 
tions, but to treat them merely as inciden- 
tal facts brought out officially from time to 
time, and as they may be ascertained and 
put of record in the department, there to 
be used when they have all been accumu- 



88 
lated and are sufficiently complete to jus- 
tify executive recommendation based on 
them. Now I think it is utterly useless, 
as I think it would be greatly distressing 
to business, to talk of another revision of 
the tariff during the present Congress. I 
should think that it would certainly take 
the rest of this administration to accu- 
mulate the data upon which a new and 
proper revision of the tariff might be 
had. By that time the whole Repub- 
lican party can express itself again in 



8 9 

respect to the matter and bring to bear 

upon its Representatives in Congress 
that sort of public opinion which shall 
result in solid party action. I am glad 
to see that a number of those who 
thought it their duty to vote against 
the bill insist that they are still Re- 
publicans and intend to carry on their 
battle in favor of lower duties and a 
lower revision within the lines of the 
party. That is their right and, in their 
view of things, is their duty. 



90 

It is vastly better that they should 

seek action of the party than that they 
should break off from it and seek to 
organize another party, which would 
probably not result in accomplishing any- 
thing more than merely defeating our 
party and inviting in the opposing party, 
which does not believe, or says that it 
does not believe, in protection. I think 
that we ought to give the present bill a 
chance. After it has been operating for 
two or three years, we can tell much 



9i 

more accurately than we can to-day its 

effect upon the industries of the country 
and the necessity for any amendment in 
its provisions. 

I have tried to state as strongly as I 
can, but not more strongly than I think 
the facts justify, the importance of not dis- 
turbing the business interests of this coun- 

/ 

try by an attempt in this Congress or the 

next to make a new revision; but mean- 
time I intend, so far as in me lies, to secure 
official data upon the operation of the tariff, 



92 

from which, when a new revision is at- 
tempted, exact facts can be secured. 

I have appointed a tariff board that 
has no brief for either side in respect to 
what the rates shall be. I hope they will 
make their observations and note their 
data in their record with exactly the same 
impartiality and freedom from anxiety as 
to result with which the Weather Bureau 
records the action of the elements or 
any scientific bureau of the Government 
records the result of its impartial investi- 



93 

gations. Certainly the experience in this 

tariff justifies the statement that no 
revision should hereafter be attempted in 
which more satisfactory evidence of an 
impartial character is not secured. 

I am sorry that I am not able to go into 
further detail with respect to the tariff bill, 
but I have neither the information nor the 
time in which to do it. I have simply 
stated the case as it seemed to Mr. Tawney 
in his vote and as it seemed to me in my 
signing the bill. 



LBJa'IO 



i' 



